Defense contractor RTX, through its subsidiary Raytheon Co., has agreed to pay more than $950 million to resolve allegations of defrauding the United States (U.S.) Department of Defense (DOD) and paying bribes to a high-ranking official in Qatar. The Department of Justice (DOJ) announced on Wednesday that the company would enter into two deferred prosecution agreements related to violations of government contracting laws, the Foreign Corrupt Practices Act, and the Arms Export Control Act.
One case, filed in New York, accused Raytheon of paying bribes to an unnamed Qatari air force official between 2012 and 2016 to secure lucrative contracts related to air defense systems. The payments, disguised through falsified documents, violated U.S. anti-bribery laws, including regulations designed to protect national security. In addition to the criminal penalties, Raytheon is also required to pay fines to the U.S. Securities and Exchange Commission (SEC) for the bribery violations.
In a separate case in Massachusetts, Raytheon was found to have inflated costs on several government contracts with the U.S. Army and Air Force, including a contract for Patriot missile systems and a radar surveillance project. From 2011 to 2013, Raytheon reportedly misled the DOD, causing overpayments of approximately $111 million. In one instance, the company lied about an increase in costs for a $619 million missile battery contract, causing the government to overpay by $100 million.
As part of the settlements, Raytheon will pay $574 million in the Massachusetts case and $280 million in the New York case, bringing the total financial penalties to nearly $1 billion. The agreements also mandate that Raytheon implement enhanced compliance measures, including the appointment of two independent monitors to oversee the company’s adherence to anti-corruption and export control laws over the next three years.
The DOJ emphasized that the penalties reflect the severity of the violations. Breon Peace, U.S. Attorney for the Eastern District of New York, stated that Raytheon’s conduct, which included falsifying records and bribing foreign officials, undermined national security and violated public trust. Kevin Driscoll, Deputy Assistant Attorney General, highlighted the impact on American taxpayers and businesses that comply with the law.
RTX, which rebranded from Raytheon Technologies in 2022, stated that the misconduct predates its 2020 merger with United Technologies. The company acknowledged the violations and expressed its commitment to compliance and ethical business practices going forward.
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